A dance with China

Hi everyone, it’s Sarah reporting from Shanghai. After trade wars, tech sanctions and a pandemic, China is dusting itself off and inviting t [View in browser]( [Bloomberg]( Hi everyone, it’s Sarah reporting from Shanghai. After trade wars, tech sanctions and a pandemic, China is dusting itself off and inviting the world to resume investing. But first... Three things you need to know today: • You can now [customize your ChatGPT]( • Slack’s CEO is [leaving for Bumble]( • Dish shares plummeted after [disappointing earnings]( Let’s not talk about it On the surface, there was much to be optimistic about at this year’s China International Import Expo, an annual trade fair in Shanghai considered to be one of President Xi Jinping’s pet projects. The country’s premier, Li Qiang, opened the event with pledges to expand imports and protect foreign investors. Anthony Albanese became the first Australian leader to visit China in seven years, joining executives from the likes of PepsiCo Inc. and HSBC Holdings Plc. Crowds jostled for freebies across the exhibition halls, queuing for Iberian ham and customized Coach tags. But for all the pomp and circumstance, you couldn’t get away from the political undercurrent. Today’s China is harder to navigate for outsiders, from its[data security]( laws and [anti-espionage](bbg://securities/QS7R1IT0G1L0) rules to the [targeting](of US companies like Micron Technology Inc. and [Apple Inc](. Relations with the US are also spiraling in the wrong direction, with Washington’s recent [tightening](of restrictions on chip-related sales to China. That sense of unease was clear every time I approached the booths representing key nodes on the global semiconductor supply chain – from Qualcomm Inc. and Advanced Micro Devices Inc. to Intel Corp. and ASML Holding NV — as a reporter. The reps immediately clammed up about challenges in the China market and had zero interest in going on the record. These global tech companies want to do business in the world’s largest market for their wares, but they’re also wary of showing too much commitment, for fear of incurring scrutiny in the US. “We don’t want to get caught up in politics” was a sentiment I heard expressed repeatedly. It’s a tough balancing act, and one that’s increasingly difficult to pull off. Can anyone be sure that their chips won’t be next on the US export ban list? And how far will China go in its retaliation to such steps? Without answers, the modus operandi is to simply avoid the spotlight. It took several rounds of convincing even to briefly shake hands with one chip executive. I did speak on the sidelines of the expo with Bing Zhou, general manager of Intel China corporate affairs. While he was optimistic about the China market and the future of artificial intelligence, there was little he could say about whether or not Intel will be able to sell to Chinese AI developers — or even its future in the country. General queries about macro market uncertainties were politely brushed away. But when no one knows when and where the next geopolitical ruction might be, who can blame them? Outside the chips zones, the expo was still bustling with activity, with robots playing Chinese checkers and VR headset displays from Meta Platforms Inc. The Chinese government has sought to signal the return of its consumer strength in its bid to woo foreign business. Some were [skeptical](bbg://news/stories/S3JEOHT1UM0W) — the European Chamber of Commerce in China called the event “[largely smoke and mirrors](” — but the CIIE in itself is a big signal that China is still open for business. Japanese outfits like Panasonic Holdings Corp. and Toyota Motor Corp. held a briefing trumpeting the CIIE as a key platform. Russian jewelry makers were out in search of Chinese partners to help them enter the large (and geopolitically friendly) market. Reps in front of the Skechers booth displayed colorful sneaker sets, and the Zara stage arranged small lit-up cubes around a giant brand statue. Even Canada Goose — not so long ago reviled by consumers at the height of China’s [dispute]( with Canada over Huawei’s Meng Wanzhou — set up racks of their signature winter jackets. It was my first time back in Shanghai in two years. While the city itself feels slightly emptier than in years past, attendees say the crowds at this year’s expo seem closer to 2018, when the event first began. Things have and will continue to change — it’s just incredibly hard to predict the speed and direction of that shift. Most businesses are focusing on showing off what they can sell, so long as they’re still able to sell it. —[Sarah Zheng](mailto:szheng244@bloomberg.net) The big story Big pharma is using AI to improve diversity in clinical trials because underrepresented communities are [less likely to participate](. Johnson & Johnson is using AI to pinpoint community centers where people who need certain medicines are located. One to watch [Watch the Bloomberg Technology TV interview]( with Accel Partner Sonali de Rycker. Get fully charged The investment firm Proof Group is one of the many bidders [looking to relaunch FTX](, the cryptocurrency exchange started by Sam Bankman-Fried. Italy is seizing $835 million from Airbnb after the company [failed to pay some taxes](. Palo Alto Networks is acquiring the [Israeli cybersecurity startup Talon]( in a deal valued at $625 million. An economist testified in Google’s antitrust trial that the company’s search engine [competes with every company on the web](, including Amazon and Yelp. More from Bloomberg Get Bloomberg Tech weeklies in your inbox: - [Cyber Bulletin]( for coverage of the shadow world of hackers and cyber-espionage - [Game On]( for reporting on the video game business - [Power On]( for Apple scoops, consumer tech news and more - [Screentime]( for a front-row seat to the collision of Hollywood and Silicon Valley - [Soundbite]( for reporting on podcasting, the music industry and audio trends - [Q&AI]( for answers to all your questions about AI Follow Us Like getting this newsletter? [Subscribe to Bloomberg.com]( for unlimited access to trusted, data-driven journalism and subscriber-only insights. 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